Lawyers for Federal Reserve Governor Lisa Cook argued on Thursday that the Supreme Court should reject President Donald Trump’s request to fire her while her lawsuit challenging her removal is pending. In a new filing with the Supreme Court, Cook’s lawyers wrote, “The President’s stay application asks this Court to act on an emergency basis to eviscerate the independence of the Federal Reserve Board.”
Trump has asked the Supreme Court to lift lower court orders that are currently blocking him from firing Cook. He said in late August that he was firing her based on allegations that she committed mortgage fraud by claiming two separate properties as her primary residence. Cook denies these claims of wrongdoing, which relate to properties she owns in Ann Arbor, Michigan, and Atlanta.
The Core Legal Question
The central question in Cook’s case is whether Trump has the legal “cause” as required by the Federal Reserve Act to fire her. In their filing, Cook’s lawyers argued that Trump was citing “flimsy, unproven allegations of pre-office wrongdoing” that were “conveniently timed” following his criticisms of the Fed’s policy decisions. Trump had complained for months that the Fed was not cutting interest rates as he wanted. The Fed, with Cook participating, lowered its benchmark interest rate last week for the first time in months.
Cook’s lawyers argued that the Supreme Court should deny Trump’s “extraordinary application” because his arguments “defy established precedent and longstanding practice.” They wrote that the “for cause” standard provided by the Federal Reserve Act is a meaningful protection for a Fed governor and that it is not satisfied by “manufactured charges based on conduct that pre-dates her service on the Board.” The lawyers concluded that “there must be some meaningful check on the President’s ability to remove Governor Cook” to protect the Fed from presidential control.
Broader Support for Cook’s Stance
Earlier on Thursday, a group that included every living former Federal Reserve chair, along with a number of former Treasury secretaries and former chairs of the White House Council of Economic Advisers, urged the Supreme Court to deny Trump’s request to fire Cook. Their support highlights the widespread concern within the financial establishment over the potential threat to the central bank’s autonomy. If the high court allows Trump to remove Cook, she could be reinstated once the justices rule on the merits of her lawsuit.
Author’s Opinion
This case is about more than the fate of one Fed governor; it represents a high-stakes test of the institutional checks and balances that are fundamental to the U.S. economy. The Federal Reserve’s independence has been a cornerstone of its effectiveness for decades, and a ruling in favor of Trump could set a dangerous precedent, opening the door for future presidents to use political pressure to influence monetary policy. The widespread support for Cook from previous leaders of the Fed and Treasury underscores how seriously the financial establishment views this potential threat to the central bank’s autonomy. The Supreme Court’s decision will determine whether the Fed remains an independent body or becomes an arm of the executive branch.
Featured image credit: Heute
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